The price of groceries could jump by £1.7 billion because of an increase in the cost of liquid carbon dioxide (CO2).

That’s according to new research by the Energy and Climate Intelligence Unit (ECIU) which suggests the UK’s food and drink sector might foot the rising bill because of the soaring prices of CO2.

CO2 has a wide variety of applications across the food and drink sectors –  among other deployments, it is being used for fizzy drinks and to extend fruit and vegetables’ shelf life.

The ECIU analysis shows that the cost for a tonne of liquid CO2 is 3,000% higher, compared to what it was in 2021.

In August, CF Fertilisers announced it would halt ammonia production at its Billingham Complex plant – it is estimated that the company supplies nearly 40% of the country’s carbon dioxide.

Matt Williams, Climate and Land Programme Lead at the ECIU, said: “The UK’s reliance on fossil fuels affects more than just families’ energy bills. It could bring the food and drink system to its knees.

“Rising energy costs are creating an extra cost of hundreds of millions of pounds in the food and drink industry that customers may struggle to avoid. If high gas prices, or even blackouts, force factories to close it could create real problems for farmers and the food and drink industry.”